Written by In the recent case of CN1 Pty Ltd v NSW Self Insurance Corporation (2025) NSWSC 1464, the NSW Supreme Court examined whether residential building work carried out across separate, non-contiguous lots could be treated as a single residential development under section 3A of the Home Building Act 1989 (NSW) (‘HBA‘). CN1, the owner of multiple lots within a subdivision, had entered into contracts with a builder to construct dwellings on two non-contiguous lots. When the builder became insolvent, CN1 sought reimbursement under their insurance policies, but the claim was denied on the basis that CN1 qualified as a ‘developer’ under the Home Building Act and was therefore ineligible for coverage.
At first instance, NCAT found that CN1 was not a developer under section 3A of the HBA and was entitled to compensation from SiCorp, reasoning that the lots constituted separate developments. Subsequently, the NCAT Appeal Panel overturned the decision and ruled in SiCorp’s favour. The Supreme Court, however, set aside the Appeal Panel’s determination, finding that CN1’s status had been assessed at the wrong time. The Court clarified that whether a landowner or project owner qualifies as a developer must be evaluated at the time the building work is carried out, and that multiple lots, even if non-contiguous, may in some circumstances form a single residential development depending on the practical context of the project.
This decision highlights significant risks for landowners and builders involved in multi-lot projects. Being classified as a developer can affect insurance coverage, leaving owners potentially exposed to uninsured losses if the builder becomes insolvent or defects emerge. Landowners should carefully consider how projects are structured, including whether lots are contiguous or part of the same overall development, and the timing of construction relative to insurance policies.